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But as you will understand, I don't like to post things that mischaracterize and are aimed to mislead.

-- Brad Delong

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Tuesday, December 28, 2010

The U.S. Economy is Dying - Pt 2.

Back in October I posted Part 1, based on a look at GDP since WW II.  Here are some other dismal facts to ponder.  Consider first, Capacity Utilization.  Data from the Federal Reserve.

It's easy to pick out the recessions on this graph.  The line droops like an icicle as business slows, then climbs up again as we come out of recession.  The disturbing thing is the trend line, shown in green on the chart - relentlesly down, down, down for over 40 years, as each recovery is more anemic than the last.

Just for kicks, the capacity utilization line is sketched out in Red and Blue segments, indicating the spans of Republican and Democratic administrations. I've also added a horizontal line for each admin, indicating the average of utilization over its time span.  Note that the moribund Carter admin. was at a higher level than ANY of the Republicans.  Actually, at 83.45%, Carter even inches out Clinton at 82.84%.   It's just an amazing coincidence that all of the icicle tips - except for the last one, that B. Hoover Obama inherited from his idiot predecessor - are Red.  One might also note in passing that the onset of a Republican administration is always - and I mean ALWAYS indicated by a steep drop in capacity utilization (e.g. RECESSION).  This must be one of the ways in which Republicans are good for business.

Right now, in the midst of an a scintillating recovery - we've been stalled at 75% for three months - we're still nowhere near the descending tend line that connects the tops.  Note also that 75% is in the mid-range for previous bottoms.

Here's industrial production since 1967, from Calculated Risk.

There was a time when this was a growth curve - then G. W. Bush happened.  Now it looks like we're stalling out at a level that was once a peak - a mere 10 years ago.

Remember that small business are the real growth engine of our economy.  Here are their near term hiring plans, also from CR.

The ZERO level used to occur at bottoms.  Now, we've had to improve to get to that level.  (Take that, Lump of Labor Fallaciators.)  Plus it looks like we might be stalling there as well.

On the other hand, though, big business are doing their part by hiring lots of people.   That would perhaps be more helpful if it were happening on this continent.  (Take that, Lump of Labor Fallaciators.) (H/T to the L/W.)

And if you're wondering why all this is happening, let's ask all the small business owners what their biggest problem is.

Poor sales?!? Could that be an aggregate demand shortfall?

Those small business owners sound like a bunch of Keynesian idiots!

No wonder we're in so much trouble.


Anonymous said...

And these facts have been apparent for decades to anyone who wanted to make a case about them.

Now, what do you suppose was in the minds of our MSM during all this time?

And our politicians? Including the reigning "Dims."


Good thing we've got a stoopid and slow-to-absorb-math populace, isn't it?

Thanks for the facts, sweetie!

As if those people will now arise and demand justice.



Suzan said...

Er, that's me above, sweetie.

It looked like it absorbed my identity when it left me.

Er, teh miracle of the intertubes?

Love ya,